Professor Elam

Buffett believes the economy is growing slowly.   He has no plans to sell on the Ukraie situation.

But no onder, after all, he does not just own shares, he actually owns most of his companies on a consolidated basis. And so when they make money, the money is his, no matter what the share price might do.

He bought a railroad and now owns the profits hauling oil, handy since his President has not approved hte Keystone XL pipeline. Even if  rai pipeline is pproved, much of the oil will stil be moved by rail.

IF one owns the shares of a company with no dividend, one is dependent on the shares advancing. If one owns the company outright, the cash flow is yours, big difference.

We disucss this in types of ownership in intermediate accpounting in Chapter 12 INvestments.

If one owns less than 20%, one accounts for this as an availab dowor sale or an trading security.

The equity method is used if one owns 20-49%. But even then one does not received the income of the company owned.

Only if one owns > 50% do we consolidate the returns when one really does have a claim on the cash flow.